Overbought Trading Ends with Japan’s Monetary Drama Carving Topping Patterns In Stocks – The Market Breadth

topping pattern (Credit: Don't fall off the cliff by blmurch on Flickr)

Stock Market Commentary The Federal Reserve’s latest pronouncement on monetary policy was supposed to provide the drama of the week. However, the stock market yawned and resumed the buying of the summer of love at the open of trading the next day. Enter the Bank of Japan (BoJ) to provide the real drama. The fireworks … Read more

Key Endorsements for the 2023 Run-Up In Stocks – The Market Breadth

endorsements (Credit: Air salute by The U.S. Army on Flickr)

Stock Market Commentary: The summer of loving stocks may have begun. In a list of debt ceiling winners and losers, Vox failed to list the stock market as one of the biggest winners. The lingering and residual angst accompanying the manufactured drama of the debt ceiling released its hold on the market’s bias to go … Read more

It Took 519 Trading Days to Close Oversold – The Market Breadth

Stock Market Commentary: The last “official” oversold period was 519 trading days ago. After 8 different intraday dips into and out of oversold territory, the stock market finally closed in oversold conditions. The signs of a bear market include the inability to stay out of oversold conditions. Today’s series of breakdowns combined with further deterioration … Read more

The Bullish Signals That Are Hard to Believe – The Market Breadth

Stock Market Commentary: The stock market continued its quest to convince us that the world is getting or soon will get a lot better. Perhaps the market is somehow feeding off the definitive hawkishness from the Federal Reserve. Whatever the explanation, market breadth expanded to levels last seen 4 months ago. The rally demonstrates broadly … Read more

Watch Currencies, Not Stocks, As Geo-Political Tensions Continue to Rise

The news headlines rang out today that Russia’s leader Vladimir Putin gave the orders to send “peacekeeping” troops into two breakaway regions of Ukraine. Stock market futures reacted instantly. Yahoo had a particularly dramatic headline declaring that futures “tanked.” Reflexively, I checked CNBC to review the preliminary damage: S&P futures down 1.8% and the NASDAQ … Read more

The AUD/JPY Divergence Dragging on the Stock Market

Deteriorating market breadth flashed warning signs for the stock market once again. A signal from the currency market is adding weight to the warning: the Australian dollar versus the Japanese yen (AUD/JPY). AUD/JPY represents the divergence dragging on the stock market. AUD/JPY topped out from March to June, a period over which many individual stocks … Read more

A Fresh Crack in the Stock Market’s Complacency

A Fresh Crack from the Currency Market At the time of writing, the Australian dollar versus the Japanese yen (AUD/JPY) is falling below its 50-day moving average (DMA) (the red line in the chart below) for the first time since last September. This move is the latest yellow, perhaps red, flag on the stock market … Read more

Australian Dollar: A Fading Pandemic Supports A V-Shaped Recovery

“Other scenarios for the recovery phase can readily be envisaged. Given the relatively rapid decline in the number of new COVID-19 cases in Australia, it is possible to contemplate an upside scenario where most domestic restrictions on activity are relaxed a little sooner and the economy recovers somewhat faster than in the baseline scenario. The greater … Read more

Market Crash 2020 Addendum

This post is a quick addendum to the Above the 40 post I published just ahead of a complete freefall in global financial markets. At the time of writing, futures are showing a 5% drop in the S&P 500 (SPY)! The crash is reflected in real-time in the currency markets. I actively watch the Australian … Read more

AUD/JPY: A Key Tell for the Week’s Post-War Bottom

The 15-minute chart of the Australian dollar versus the Japanese yen (AUD/JPY) shows the abruptness of the risk-off sentiment.

Last week’s geo-political drama had all the makings of an escalation to all-out war. A country incensed about the assassination of its top general lobbed missiles at airbases its enemy occupies in a neighboring country. Everyone braced for the typical response of attacking the sites that lobbed the missiles. With its borders breached by the … Read more